Jerry York: I'd sell Volvo, Mercury if I were Ford chief
From Automotive News (
Automotive News -- In-depth coverage of the automotive industry with special features for subscribers):
Jerry York: I'd sell Volvo, Mercury if I were Ford chief
DETROIT -- Jerry York, a former auto executive who represents Kirk Kerkorian's Tracinda Corp., isn't shy about sharing his opinion. York said he thinks Ford Motor Co. CEO Alan Mulally will hold on to the Lincoln brand but sell Volvo and Mercury -- and that Mulally would be right to do so.
York, who met with Mulally last month, said he has great confidence in Mulally's plan to turn around Ford Motor.
Speaking hypothetically, York told
Automotive News today that if it were his call, he would unload Volvo and Mercury.
"I'm very confident that (Mulally's plan) is the answer, and I think you'll see that he'll put Volvo on the market within the next year and a half," York said in an interview. "There's no rational reason for keeping Volvo or Mercury."
York said Mulally did not tell him any of his plans.
Lincoln margins 'terrific'
This week, Kerkorian's Tracinda announced that it plans to make a cash tender offer for as many as 20 million shares of Ford stock at $8.50 a share. Tracinda already owns 100 million shares, representing 4.7percent of Ford's shares outstanding.
Kerkorian's company began buying Ford shares April 2 and has paid an average price of $6.91 a share, Tracinda said. York didn't meet with Mulally until after the purchases began.
York told
Automotive News that Mulally is "highly focused" on the Ford brands. "The margins on Lincolns are terrific, and my guess is that's where he's headed -- he'll probably keep Lincoln," York said.
When asked whether York would sell Mercury, he said: "Mercury, as a matter of principle, I would (sell it). But first I'd want to understand the likely cost savings versus the value loss, and that's always a difficult analysis. You have to see how many Ford customers would stick with Ford if you closed Mercury."
Asked whether he's worried that Kerkorian's involvement could distract Ford executives, Mark Fields, Ford president of the Americas, said, "We're happy that people have confidence in Ford and in our turnaround plan."
Ford has a lot of challenges ahead, Fields said in an interview Wednesday, "so we can't control what happens externally. What we can control as a team is how we're going to focus our efforts."
York was Kerkorian's representative on General Motors' board of directors from December 2005 until October 2006. Kerkorian held a 9.9 percent stake in GM at the time.
York and Kerkorian tried to push an alliance between GM and Renault-Nissan but failed. Asked whether Ford needed an alliance partner, York declined to speculate.
